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Thai Sugar Industry Weighed Down by Policy Vacuum

The future of the Thai sugar industry remains shrouded in a haze, both literally and figuratively. In February 2019, air pollution levels in many of the country’s cities rose to dangerous levels. In Bangkok, the hazardous haze is mainly generated by the incomplete combustion in car engines.

But in Khon Kaen, a major city in the north of the country, the main culprit for the smog is farming practices where planters burn sugar fields before cutting. Indeed, the air pollution from cane burning has been going on for over a decade mostly because it saves costs. Burnt sugarcane is much easier to cut and that helped farmers send their sugar cane to the mills in time.

In order to address the problem, the Thai government has approved a loan facility to the tune of THB6 bln (USD1=THB31.27) between 2019 and 2021 to farmers to allow them to buy harvest combines. Farmers will have to pay back the loans over a 10-10-year period at an interest of 1%.

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The future of the Thai sugar industry remains uncertain with regard to exports markets, concomitantly with implementation of new policy frameworks. Click below to get more information about current trends in production as well as the Thai government's efforts to reform the country's broader sugar system.

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